Understanding The Health Insurance Market
A close look at factors that influence the purchase of health insurance policies
- Health insurance penetration is higher among affluent segments, in metros and in the west zone
- Online purchase of health insurance policies is higher than even a highly penetrated category like life insurance
- Quick claim settlement and agent knowledge of the product are key factors driving consumers’ choice of health insurance brands
As the economy struggles to get to its feet in the aftermath of the economic slowdown, consumer confidence in India remains weak. This fear of an under-performing economy and rise in prices often leads to a shift in consumer focus towards savings. Similarly, budgets are cut and spending is restricted to elementary needs such as health care, which is one of the top five concerns that consumers say affect household budgets.
Fear of poor service (53%) and not getting the claim amount (50%) prevents a majority of people from seeking health insurance. Instead, they keep money in their savings accounts for medical emergencies. However, health insurance policies are sources of confidence for consumers who feel that they protect them from any unforeseen financial hardship.
Room For Growth
Health insurance is a category that has a lot of potential to grow as it is still at a nascent stage. Brand recall is lowest for the health insurance category when compared to other, more highly penetrated categories such as life and motor insurance.
In spite of this, health insurance penetration and consumers’ intention to purchase have increased in the past three years.
Triggers And Preferred Features
The two major triggers for consumers to consider getting health insurance are increasing incidence of new and fatal diseases and rising health care costs.
Premium to be paid on the policy and coverage of diseases is what consumers look for in a policy. Consumers don’t want to be surprised at the time of making the claim. Wide network of hospitals also matter to consumers. In addition, they seem wary of policies containing too many terms and conditions.
Preferred Channels Of Purchase
Apart from traditional purchase channels such as agents, companies and banks, more and more health insurance consumers are buying policies online. In fact, more consumers purchase health insurance than a highly penetrated category like life insurance.
Consumers mentioned saving on time and convenience are the biggest advantages of buying health insurance policies on the Internet. This preference for buying online presents an opportunity for companies to enhance the appeal of their health insurance by improving their digital presence to meet consumer expectations for online purchases.
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